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Re-inventing
                          Business
                     Requirements
James Taylor
       CEO
                              with
               Decision Management
Your presenters
 James Taylor                     Don Perkins
  CEO of Decision                  Independent Business Rule
  Management Solutions             Consultant
  Works with clients to
  improve their                    Applies and mentors a
  business by applying analytic    decision-centric approach to
  technology                       business rule analysis,
  to automate & improve            specification, and authoring
  decisions                        2 decades experience
  Spent the last 9 years           building rule-based systems
  developing the
  concept of Decision
  Management




                                         © Decision Management Solutions, 2012
AGENDA

         1 2
     Why Reinvent
     Requirements?
                     Beginning with
                     Decisions
                                         3
                                      Putting Decisions
                                      in Context




         4 5 6
     Detailed        Questions and    A Final Thought
     Decision        Answers
     Requirements
Why Reinvent
Requirements?
Operational and analytic systems

1. Operational systems are built in a variety of ways

                     Application Context
                                                                3. Reports and queries are
  Business Process                         Enterprise
   Management
                       Event Processing
                                           Application          intended to improve decision
                                                                making

                                                                              Business
                                                                            Intelligence
                                                    Data
                                               Infrastructure


                                                                           Performance
  2. Data is extracted for analysis                                        Management




                                                                4. Dashboards are used
                                                                to monitor performance

                                                                © Decision Management Solutions, 2012
Powerful technologies are underutilized

1. Business rules are forced into business processes
                                                                                                       Predictive
                                                                                                       Analytics
         Business Rules   Application Context
                                                                      2. Predictive analytics are
  Business Process                               Enterprise
   Management
                            Event Processing
                                                 Application          forced into reports or left
                                                                      stand-alone

                                                                                     Business
                                                                                   Intelligence
                                                          Data
                                                     Infrastructure


                                                                                  Performance
                                                                                  Management




                                  3. The effectiveness of
                                  decision-making is not         Decision
                                                                 Analysis
                                  tracked or improved
                                                                       © Decision Management Solutions, 2012
Decision Management is the
  proven approach used to
 manage decisions and apply
business rules and predictive
     analytics effectively


                    © Decision Management Solutions, 2012
Decision Management maximizes ROI
                                                             Decision Management links these
                                                             technologies to the application context

                                        Application Context

    Business
                  Business Process                                    Enterprise
  Intelligence                            Event Processing
                   Management                                         Application
                                                                                                  Performance
                                                                                                  Management
                                 Decision Management

      Data                                                                  Decision
                                                    Predictive
 Infrastructure        Business Rules                                       Analysis
                                                    Analytics



  Decision Management ties these
     technologies into a coherent
       approach for better results
                                                                       Decision Management ties
                                                                       how decisions are being made
                Decision Management allows                             and what can be done to
         decision performance to be tracked,                           improve them directly to
           analyzed and ultimately improved                            business performance

                                                                        © Decision Management Solutions, 2012
Success requires a clear target




                             © Decision Management Solutions, 2012
Success requires collaboration


                  Business




                             © Decision Management Solutions, 2012
Begin with decisions
Decisions




            Making choices or
            selections and taking
            action

                   © Decision Management Solutions, 2012
Suitable decisions



  Repeatable          Non trivial


  Measurable
                     Candidate for
   business
                      automation
    impact
                        © Decision Management Solutions, 2012
Different types of operational decision



   Eligibility   Validation         Calculation



     Risk          Fraud         Opportunity



                              © Decision Management Solutions, 2012
These Decisions Are Made Because




A business process cannot   A particular event has     A person must choose
progress any further        occurred and must be       between a number of
unless they are made        handled                    options




                                                     © Decision Management Solutions, 2012
Use Questions to Define Decisions
 Besides a Name and Description
 Define Decisions with
   A question
   Possible answers
 Add key facts like volume, complexity, latency




                                  © Decision Management Solutions, 2012
Put decisions in a
 business context
Discovering Decisions

              Business Processes




 Brainstorm
                                                     Performance Management




                                   Business Events




                                                                           Legacy Systems




                                                          © Decision Management Solutions, 2012
Target decision-making on KPIs

                          Strategy defines KPIs



                        KPIs measure operations



                    Operational decisions affect KPIs



                     The link between decisions and
                              KPIs is critical
                              © Decision Management Solutions, 2012
Decision making confuses processes

      Age<21                                 No Class I or II sports

                                                                                  Accept low-risk applicant



                                                        Class II sport
               Previous Heart Attack,
               Existing Cancer                                                                                                  Decline high-risk
                                                                                                                                   applicant

      21<=Age<50




                                                          Class I sport


                                                                                      Process medium-risk
                Good Medical Record                                                        applicant




      Age>50                                                           1 or fewer Claims                      Multiple Claims

                             New Customer

                                                                                                                 …




                                            Long-standing Customer




                                                                                                       © Decision Management Solutions, 2012
Identifying decisions simplifies them



                                Low risk
                                               Process low-risk
                                                  applicant


                                Medium risk


          Determine applicant                 Process medium-risk
                type                               applicant


                                High risk


                                               Process high-risk
                                                  applicant




                                                             © Decision Management Solutions, 2012
Decisions in context
 Processes                       Know which business
  Activities require decisions   processes will be improved
                                 by your rules or analytics
 Events                          Know when your analytics
  Trigger decisions              might be calculated

 Systems                         Know how you will have to
  Implement decisions            deploy your rules

 Organizational Units            Know who will have to
  Make decisions                 believe your analytics and
  Own decisions                  own your rules
  Are impacted by decisions

                                        © Decision Management Solutions, 2012
Detailed Decision
   Requirements
Good Decision Requirements

Information            Know-how
• What is needed?      • How to make it
• Where does it come   • How to improve it
  from?


Precision              Automation
• Exactly how?         • All automated?
• How to avoid         • If not, how much can
  technical details?     be and for whom?
Decompose the decisioning
 What is required to make decision?
  Information

  Guidelines, policy
  Expertise
  Regulations
  Predictive Analytic Models
  Data Mining Results

  The results of other decisions

                                   © Decision Management Solutions, 2012
A Complete Decision Definition
 Definition
   Question and Allowed Answers
 Purpose and Value
   Links to KPIs and Objectives
 Context
   Processes, Events, Systems
   Organizations
 Decomposition
 Link to implementation
                                  © Decision Management Solutions, 2012
Discovering Decisions From Process
• A business process model can be an effective
  source for identifying high-level decisions
• Prioritize decisions to know where to start
High-Level Decision & Dependencies
Simple Supporting Decision
             • Larger node is the subject
               of the diagram
             • Context established by
               drilling down from high-
               level decision
             • Only the dependencies of
               the subject decision are
               shown
             • All of the business logic is
               defined in the supporting
               decisions
A More Involved Example
              • Multiple layers of
                decision
                dependencies
              • Abstraction of full
                story
              • 3 different patterns
                of how to handle
                different states
              • 1 state breaks all
                patterns and has
                separate diagram
Full Diagram Depicting All States
A Tricky Decision Decomposition
• A seemingly simple decision was complicated
  by lots of exceptions to the basic business
  rules
• Discovering the proper decomposition was key
  to defining a satisfactory solution
Initial Attempts
        • Business rule requirements
          initially gathered as an
          unorganized list
        • A manageable number of
          business rules, but with lots
          of seemingly complicated
          exceptions
        • 3 initial attempts to
          synthesize a decision
          structure from the bottom
          up failed to support the
          business rule requirements
Successful Decision Decomposition
                  • Partial solution by
                    eliminating
                    exceptions
                  • Switched analysis
                    from negative rules to
                    positive rules
                  • Complete solution
                    found after refocusing
                    on a top down
                    approach
Rule Family Template
• Business rules are defined in rule families
• Multiple conditions, one conclusion
• A message explaining each negative rule
Sample Business Rules
• Simplified version with exceptions removed
• Key elements are
  – Negative rules contain business rule statements
  – Positive rules complete full coverage
Questions?
A Final Thought
Decisions First

                  Find the decisions that
                  matter to your business and
                  model them as requirements




                              © Decision Management Solutions, 2012
Thank You
                James Taylor, CEO
james@decisionmanagementsolutions.com

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Reinventing business requirements with decision management

  • 1. Re-inventing Business Requirements James Taylor CEO with Decision Management
  • 2. Your presenters James Taylor Don Perkins CEO of Decision Independent Business Rule Management Solutions Consultant Works with clients to improve their Applies and mentors a business by applying analytic decision-centric approach to technology business rule analysis, to automate & improve specification, and authoring decisions 2 decades experience Spent the last 9 years building rule-based systems developing the concept of Decision Management © Decision Management Solutions, 2012
  • 3. AGENDA 1 2 Why Reinvent Requirements? Beginning with Decisions 3 Putting Decisions in Context 4 5 6 Detailed Questions and A Final Thought Decision Answers Requirements
  • 5. Operational and analytic systems 1. Operational systems are built in a variety of ways Application Context 3. Reports and queries are Business Process Enterprise Management Event Processing Application intended to improve decision making Business Intelligence Data Infrastructure Performance 2. Data is extracted for analysis Management 4. Dashboards are used to monitor performance © Decision Management Solutions, 2012
  • 6. Powerful technologies are underutilized 1. Business rules are forced into business processes Predictive Analytics Business Rules Application Context 2. Predictive analytics are Business Process Enterprise Management Event Processing Application forced into reports or left stand-alone Business Intelligence Data Infrastructure Performance Management 3. The effectiveness of decision-making is not Decision Analysis tracked or improved © Decision Management Solutions, 2012
  • 7. Decision Management is the proven approach used to manage decisions and apply business rules and predictive analytics effectively © Decision Management Solutions, 2012
  • 8. Decision Management maximizes ROI Decision Management links these technologies to the application context Application Context Business Business Process Enterprise Intelligence Event Processing Management Application Performance Management Decision Management Data Decision Predictive Infrastructure Business Rules Analysis Analytics Decision Management ties these technologies into a coherent approach for better results Decision Management ties how decisions are being made Decision Management allows and what can be done to decision performance to be tracked, improve them directly to analyzed and ultimately improved business performance © Decision Management Solutions, 2012
  • 9. Success requires a clear target © Decision Management Solutions, 2012
  • 10. Success requires collaboration Business © Decision Management Solutions, 2012
  • 12. Decisions Making choices or selections and taking action © Decision Management Solutions, 2012
  • 13. Suitable decisions Repeatable Non trivial Measurable Candidate for business automation impact © Decision Management Solutions, 2012
  • 14. Different types of operational decision Eligibility Validation Calculation Risk Fraud Opportunity © Decision Management Solutions, 2012
  • 15. These Decisions Are Made Because A business process cannot A particular event has A person must choose progress any further occurred and must be between a number of unless they are made handled options © Decision Management Solutions, 2012
  • 16. Use Questions to Define Decisions Besides a Name and Description Define Decisions with A question Possible answers Add key facts like volume, complexity, latency © Decision Management Solutions, 2012
  • 17. Put decisions in a business context
  • 18. Discovering Decisions Business Processes Brainstorm Performance Management Business Events Legacy Systems © Decision Management Solutions, 2012
  • 19. Target decision-making on KPIs Strategy defines KPIs KPIs measure operations Operational decisions affect KPIs The link between decisions and KPIs is critical © Decision Management Solutions, 2012
  • 20. Decision making confuses processes Age<21 No Class I or II sports Accept low-risk applicant Class II sport Previous Heart Attack, Existing Cancer Decline high-risk applicant 21<=Age<50 Class I sport Process medium-risk Good Medical Record applicant Age>50 1 or fewer Claims Multiple Claims New Customer … Long-standing Customer © Decision Management Solutions, 2012
  • 21. Identifying decisions simplifies them Low risk Process low-risk applicant Medium risk Determine applicant Process medium-risk type applicant High risk Process high-risk applicant © Decision Management Solutions, 2012
  • 22. Decisions in context Processes Know which business Activities require decisions processes will be improved by your rules or analytics Events Know when your analytics Trigger decisions might be calculated Systems Know how you will have to Implement decisions deploy your rules Organizational Units Know who will have to Make decisions believe your analytics and Own decisions own your rules Are impacted by decisions © Decision Management Solutions, 2012
  • 23. Detailed Decision Requirements
  • 24. Good Decision Requirements Information Know-how • What is needed? • How to make it • Where does it come • How to improve it from? Precision Automation • Exactly how? • All automated? • How to avoid • If not, how much can technical details? be and for whom?
  • 25. Decompose the decisioning What is required to make decision? Information Guidelines, policy Expertise Regulations Predictive Analytic Models Data Mining Results The results of other decisions © Decision Management Solutions, 2012
  • 26. A Complete Decision Definition Definition Question and Allowed Answers Purpose and Value Links to KPIs and Objectives Context Processes, Events, Systems Organizations Decomposition Link to implementation © Decision Management Solutions, 2012
  • 27. Discovering Decisions From Process • A business process model can be an effective source for identifying high-level decisions • Prioritize decisions to know where to start
  • 28. High-Level Decision & Dependencies
  • 29. Simple Supporting Decision • Larger node is the subject of the diagram • Context established by drilling down from high- level decision • Only the dependencies of the subject decision are shown • All of the business logic is defined in the supporting decisions
  • 30. A More Involved Example • Multiple layers of decision dependencies • Abstraction of full story • 3 different patterns of how to handle different states • 1 state breaks all patterns and has separate diagram
  • 32. A Tricky Decision Decomposition • A seemingly simple decision was complicated by lots of exceptions to the basic business rules • Discovering the proper decomposition was key to defining a satisfactory solution
  • 33. Initial Attempts • Business rule requirements initially gathered as an unorganized list • A manageable number of business rules, but with lots of seemingly complicated exceptions • 3 initial attempts to synthesize a decision structure from the bottom up failed to support the business rule requirements
  • 34. Successful Decision Decomposition • Partial solution by eliminating exceptions • Switched analysis from negative rules to positive rules • Complete solution found after refocusing on a top down approach
  • 35. Rule Family Template • Business rules are defined in rule families • Multiple conditions, one conclusion • A message explaining each negative rule
  • 36. Sample Business Rules • Simplified version with exceptions removed • Key elements are – Negative rules contain business rule statements – Positive rules complete full coverage
  • 39. Decisions First Find the decisions that matter to your business and model them as requirements © Decision Management Solutions, 2012
  • 40. Thank You James Taylor, CEO james@decisionmanagementsolutions.com